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    • Tigersoul
    • By Tigersoul 9th Jun 17, 8:40 AM
    • 4Posts
    • 0Thanks
    Tigersoul
    Selling House with 8 years left on Endowement
    • #1
    • 9th Jun 17, 8:40 AM
    Selling House with 8 years left on Endowement 9th Jun 17 at 8:40 AM
    Hi All

    I was wondering if i can get some advise about What's happening with my endowment when i sell my house. my house is worth about £100,000, and my mortgage is £36.750.

    1. When i sell my house will i get £100,000 into my bank account? and do I need to keep £36,750 of that safe until my mortgage matures in 8 years time? or does the money invested over the years pay for this and i get to keep the £100,000, and i just cough up for any shortfalls?

    2. my endowment is made up of 2 payments

    a) £250 payed to santander, and
    b)£64 to prudential who are my life insurance,

    so when i sell my house and keep the endowment running for the rest of its life cycle, do i still have to pay both these?

    Thanks you!
    TS
Page 1
    • TrickyDicky101
    • By TrickyDicky101 9th Jun 17, 8:53 AM
    • 2,688 Posts
    • 1,741 Thanks
    TrickyDicky101
    • #2
    • 9th Jun 17, 8:53 AM
    • #2
    • 9th Jun 17, 8:53 AM
    A condition of the sale will be that the mortgage is paid off from the proceeds - so you will see (excluding any other fees)

    £100k sale proceeds LESS £36,750 outstanding mortgage = £63,250 in your pocket

    The £250 paid to Santander every month is the interest payable on your (presumed) interest only mortgage. Once you have paid off the £36k to Santander on completion, you will no longer have this debt outstanding and therefore will not need to keep paying monthly.

    The £64 is the endowment (life insurance policy) that will continue for as long as you have the endowment (ie until maturity if no earlier surrender).

    The endowment will have a surrender value - so you could consider cashing that in depending on your investment needs.
    • Tigersoul
    • By Tigersoul 9th Jun 17, 9:34 AM
    • 4 Posts
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    Tigersoul
    • #3
    • 9th Jun 17, 9:34 AM
    • #3
    • 9th Jun 17, 9:34 AM
    Hi Tricky

    Thanks for the reply, That's cleared alot up for me. When do i have to pay santander the £36,750, when i sell my house or when my mortgage matures? or is it up to me? i'm asking because, if i have to pay it when i sell the house, won't i have to pay early repayment charges?

    thanks!
    • zx81
    • By zx81 9th Jun 17, 9:40 AM
    • 13,145 Posts
    • 13,443 Thanks
    zx81
    • #4
    • 9th Jun 17, 9:40 AM
    • #4
    • 9th Jun 17, 9:40 AM
    When you sell. If you have an ERC, you will need to pay that.
    • AnotherJoe
    • By AnotherJoe 9th Jun 17, 11:01 AM
    • 7,221 Posts
    • 7,725 Thanks
    AnotherJoe
    • #5
    • 9th Jun 17, 11:01 AM
    • #5
    • 9th Jun 17, 11:01 AM
    Hi Tricky

    Thanks for the reply, That's cleared a lot up for me. When do i have to pay santander the £36,750, when i sell my house or when my mortgage matures? or is it up to me? i'm asking because, if i have to pay it when i sell the house, won't i have to pay early repayment charges?

    thanks!
    Originally posted by Tigersoul
    Often theres a difference between the mortgage term and the term during which an ERC is payable. For example, when you took the mortgage out, maybe over a 25 year period, the terms (such as interest rate) may have been fixed for 5 years. After 5 years in that case you can close the mortgage without paying an ERC fee. There might still be a nominal fee of £100 or so to close it out.
    You'd need to contact Santander (or look at your documents) to check if an ERC applies.
    • Tigersoul
    • By Tigersoul 9th Jun 17, 12:44 PM
    • 4 Posts
    • 0 Thanks
    Tigersoul
    • #6
    • 9th Jun 17, 12:44 PM
    • #6
    • 9th Jun 17, 12:44 PM
    Thank ZX81 & Another Joe

    I've looked on the documents and I don't see any ERC.

    This has been a great help as I find mortgages confusing

    Thanks

    Guy
    • Tigersoul
    • By Tigersoul 9th Jun 17, 1:18 PM
    • 4 Posts
    • 0 Thanks
    Tigersoul
    • #7
    • 9th Jun 17, 1:18 PM
    • #7
    • 9th Jun 17, 1:18 PM
    Hi Me again, sorry just thought of another question,

    So what happens when my endowment comes to the end, since i would have paid the £36.750 mortgage off early to santander. Would I still get some money back from the endowment when that matures? and i wont have to worry about any short falls as ive already paid off the mortgage right? Silly questions just need confirmation

    thanks!
    • kingstreet
    • By kingstreet 9th Jun 17, 1:41 PM
    • 31,913 Posts
    • 17,057 Thanks
    kingstreet
    • #8
    • 9th Jun 17, 1:41 PM
    • #8
    • 9th Jun 17, 1:41 PM
    The proceeds will belong entirely to you if there is no mortgage waiting to be discharged.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • AnotherJoe
    • By AnotherJoe 9th Jun 17, 4:15 PM
    • 7,221 Posts
    • 7,725 Thanks
    AnotherJoe
    • #9
    • 9th Jun 17, 4:15 PM
    • #9
    • 9th Jun 17, 4:15 PM
    Yep, as Kingstreet says, that money is yours. The only thing you'd need to make sure happens, is that Sandander break the link between the endowment policy and them (obviously only once you pay your mortgage off). At present its very likely that policy is "assigned" to them, the idea being you cant just cash it in and run off with the money.

    So you'd need to make sure they "unassigned it" (I forget the technical term) so there's no hassle when the endowment matures
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